Commercial tax exemptions could help spur new and existing property development

By: Nick Mordowanec | C&G Newspapers | Published May 20, 2021

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CLINTON TOWNSHIP — Officials in Clinton Township continue to look into different ways to incentivize business opportunities across a mostly-developed community, including businesses that have called the township home for years.

Township Economic Development Director Brandon Jonas expounded on the Commercial Rehabilitation Act during the Board of Trustees’ April 26 meeting, saying that Act 10 of 2005 provides certain tax exemptions for commercial districts.

“Clinton Township is a 94% built-out community,” Jonas said. “All that’s left is the challenging sites. We need to start thinking of creative ways to start filling them.”

The act encourages the rehab of commercial property by abating property taxes for up to 10 years, and could refer to either single-building dwellings or groups of buildings 15 years or older and formerly used as a commercial business or multifamily residential dwelling. It could also refer to vacant property or other property that had been deemed as commercial property in the past 15 years.

Project rehabilitation requirements include restoration, improvements or modifications that are a minimum 10% of the true cash value of the property. Rehab could signify improvements in the form of improved floor loads; interior and exterior enhancements; changes in building height, heating and ventilation; and roof or foundation work.

It can also mean the development of property in vacant spaces where properties formerly existed, but were demolished.

Jonas said the Board is in control of tax resolutions, specifying whether properties can receive between one and 10 years of abatement. Board members can decide on provisions and even come back and revoke projects if they so choose.

He said the township should consider taking advantage of Act 10 due to not qualifying for other programs, such as the Obsolete Property Rehab Act, as well as being faced with several current properties that have had no movement for years.

This act would also coincide with corridor redevelopment goals as outlined the township’s economic development strategic plan, he added.

“From an economic development standpoint, you’re creating jobs for our residents,” he said. “They’re going to be spending going to our fast-food places, so they’d be spending money in the community.”

Treasurer Paul Gieleghem and Supervisor Bob Cannon agreed that properties that currently exist and are not moving forward developmentally, or are facing challenges, certainly need to be part of the total outlook.

Clerk Kim Meltzer said 10 years may sound like a long time, but called it a good economic tradeoff, as “it goes by quickly in business.”

“It has a trickling effect and it does bring in other revenue from other resources because you’re not an island,” she said.

Trustee Mike Keys said further enforcement will hold businesses accountable, while the township needs “more tools in its toolbox” to incentivize investment for current and new developments.

Jonas cited the act’s strengths in area commercial rehab projects like Macomb Mall and in various hotels along Mound Road, among others.

“The commercial rehabilitation exemption essentially freezes the existing taxable value of the facility while land, personal property, state education and the school operating tax are not frozen. … The commercial rehabilitation exemption gives the township an economic development tool in attracting new business to commercial sites that have been sitting vacant,” he later added.

At press time, no further information had been provided to, or voted on by, the Board regarding such rehabilitation.